– Alberta is in discussions with Alaska about shipping oil-sands crude through the U.S. state to the Pacific as approval for the southbound Keystone XL pipeline languishes in Washington.
The Alaska plan would involve constructing a pipeline along the Mackenzie River valley and then west to existing ports on the U.S. coast, Alberta Premier Jim Prentice said Friday in an interview at Bloomberg’s headquarters in New York. Alaskan ports have been staging points for maritime crude shipments for decades.
“It’s technically feasible,” Prentice said. “Whether it’s economically feasible has yet to be determined, so we’re working on that.”
Canadian politicians have struggled to convince opponents in North America of the merits of building new pipelines to ship crude out of land-locked Alberta. TransCanada Corp. has been awaiting U.S. approval for its cross-border Keystone project since it applied in 2008, while Enbridge Inc.’s Northern Gateway proposal has stalled, even with regulatory approval, in the face of opposition from British Columbians who fear the risk of a spill for their salmon streams and coastal inlets.
Alberta’s other pipeline options include TransCanada’s Energy East project to the Atlantic port of Saint John, New Brunswick, as well as Kinder Morgan Energy Partners LP’s Trans Mountain expansion to the port of Vancouver.
Alaska, like Alberta, is dependent on oil royalties to fund spending. The state has been hit by plunging oil prices and Governor Bill Walker proposed on Feb. 5 cuts to the budget.
Alaska is in discussions about routing a Canadian pipeline through the state, said Katie Marquette, a spokeswoman for the governor.
Walker “welcomes all constructive dialogue on growing Alaska’s economy, and looks forward to sharing experiences with another world-class energy-producing region,” Marquette said in an e-mail.
The route for a potential Alaska pipeline would cross through Canada’s Yukon and Northwest Territories, where both governments are supportive, Prentice said. Further discussions are being scheduled with Alaskan officials, he added.
“Our province needs pipelines in every direction,” Prentice said. “We are pushing on tidewater access in every conceivable venue.”
Canada approved a proposed natural gas pipeline along the Mackenzie Valley in 2013 that would ship the heating fuel from Alaska and the Canadian Arctic to markets farther south in the U.S. and Canada. The project’s proponents including Imperial Oil Ltd. and Royal Dutch Shell Plc have not provided a start-up date or said whether the project will go ahead.
An oil pipeline along a similar route and then across the international border to Alaska would require a presidential permit, like Keystone. The northernmost U.S. state already has a north-south pipeline network that takes crude from the Beaufort Sea south to the Alaskan ports on the Pacific.
In a bid to expand its energy industry, Alaska plans to jump-start a $45 billion gas export project by pitching in more than 10 percent of the cost and joining Exxon Mobil Corp., BP Plc, ConocoPhillips and TransCanada as an equity partner. The agreement between the state and the four companies outlines a framework in which Alaska would take as much as a 25 percent stake in a proposed gas processing plant, an 800-mile (1,287-kilometer) pipeline from Alaska’s North Slope and a liquefaction facility in the Kenai Peninsula.
Alberta’s Prentice, who was helping Enbridge push ahead with Northern Gateway before he became premier, said “there’s work to be done” on removing opposition to that project.
The pipeline would terminate at the British Columbian port of Kitimat at the end of the Douglas Channel, the traditional territory of the Haisla and Gitga’at First Nations which, along with neighboring indigenous groups, oppose the project because of the threat it would mean for their marine food supplies.
The port of Kitimat is about 1,600 kilometers southeast of the Alaskan port of Valdez, the main oil shipment terminal in that state.